Former CA City Official Pleads Guilty to Tax Fraud, Phony Losses Related to Horse Ranch
On December 12th, Robert Rizzo, the former Chief Administrative Officer for the city of Bell, California, agreed to plead guilty to federal charges related to “hundreds of thousands of dollars in unpaid federal income tax” (FBI LA Div. PR, 2013).
According to an FBI press release dated Dec. 12th, the two felony charges included conspiracy and filing a false federal income tax return with the Internal Revenue Service. Within that original plea agreement, Rizzo admitted to creating a corporation (R.A. Rizzo Incorporated or RARI) that he used to claim bogus losses on a “rental property” in Auburn, Washington.
According to the FBI statement, “RARI’s corporate tax return fraudulently deducted more than $409,731 in losses for the years 2006 through 2009. Rizzo also admitted in his plea agreement that he used a RARI account to pay for more than $80,000 in personal expenses in 2009 and $120,000 in construction work on his residence in Huntington Beach in 2010. RARI’s tax returns falsely claimed that these expenses were related to rental property.”
Today, the LA Times, relayed the news that Rizzo did in fact plead guilty on Jan. 13th and describes the so-called “rental property” as a horse ranch.
“It is regrettable that some public officials believe they are above the law,” said Richard Weber, Chief, IRS-Criminal Investigation. “Instead of filing accurate tax returns, Mr. Rizzo claimed bogus corporate losses on his income tax return to illegally reduce his tax liability. Pursuing public servants who corruptly endeavor to circumvent the tax laws to fund their lavish lifestyles is a top priority for IRS-Criminal Investigation.”
